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I'm glad this thread is continuing to track the progress of current versions of the bills being considered. I reread the posts and thought some had disappeared but remembered that there's a recent parallel but related thread, focusing more on the inherited IRA aspect:

I'll be 69 in 2030. DW will be 70. I like the additional 5 years for Roth conversions. But with SS starting at 70, there won't be much room for conversions at a rate lower than after RMDs start. So, not sure whether this will be helpful or not in that regard. But certainly a move in the right direction, should it pass.

I was thinking the same thing with SS at 70 y.o., but the 12% bracket including the standard deduction still is a little of 100k, so there could be some Roth conversion room.

At the very least, there would be delays in paying for taxes for monies not necessarily wholly needed for 5 years.

I wonder if someone on the cusp, needing to do RMD's in 2022 at age 70-1/2, would be able to call a "redo" in 2023 at age 71 with no RMD's then start up again in 2024? I know it is just a bill at the moment. I don't understand why the change would be delayed and isn't effective Jan 1 of the year following the signing of the law.

Not mentioned in the article, that I could see. But I would assume the opposite, since the original Senate bill referenced earlier in the thread eliminated the stretch IRA in most cases.

In the Senate bill linked by @bingybear, the stretch IRA appears to remain unaffected from what I could tell by a review of the table of contents.

__________________
"At times the world can seem an unfriendly and sinister place, but believe us when we say there is much more good in it than bad. All you have to do is look hard enough, and what might seem to be a series of unfortunate events, may in fact be the first steps of a journey." Violet Baudelaire.

As some of the media notes there are many overlaps in these bills, I would expect that many of theses bills will be stuck as bills until the differences are resolved.

That would be good for me, since it would hold off RMDs until 2040, which is when I would turn 75. It doesn't seem too many changes in the laws regarding retirement benefit Generation X, but this would be one.

__________________"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?"-- Joe Dominguez (1938 - 1997)

I would hit the 72 RMD age in 2031, so I guess I could wait until 75 then!

Yeah, it appears that this bill would change the RMD age to 75 for anyone born in, or after, 1955, "sort of". (If I am parsing the "transition rule" portion correctly). For sure it applies to anyone born in 1958 or later.)

The "transition rule" piece of this is confusing to me. It makes it sounds like someone born in (say) 1957 would have to take an RMD in 2029 (age 72) but not in 2030 or 2031 (age 73-74), and then resuming RMDs in 2032 (age 75). Can anyone figure out what this is really saying? If that is the case, people born in 1956 and 1957 would have an RMD "donut hole".

Quote:

(ii) TRANSITION RULE.—If, as of a calendar year, an employee has not attained the applicable age with respect to such year, such employee shall be treated as not having attained the applicable age under this paragraph for such year without regard to whether, in a previous calendar year, the employee had attained the applicable age with respect to such previous calendar year.

__________________"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?"-- Joe Dominguez (1938 - 1997)

So would the distribution rates (3.65% in the first year,etc) start the same at 75 y.o., or will the % be greater/less?

The bill text linked earlier has a section 109 that says that the mortality tables would be updated as part of the bill. So who knows, but my guess would be that the divisor at 75 would be equal to or larger than the current 75 divisor - meaning smaller RMDs.

__________________
"At times the world can seem an unfriendly and sinister place, but believe us when we say there is much more good in it than bad. All you have to do is look hard enough, and what might seem to be a series of unfortunate events, may in fact be the first steps of a journey." Violet Baudelaire.

So would the distribution rates (3.65% in the first year,etc) start the same at 75 y.o., or will the % be greater/less?

As best as I can tell, it would still use mortality tables, but (a) these tables would have to be updated within a year of passage of this bill into law, and (b) the mortality tables have to be updated at least once every 10 years.

That said, life expectancies are pretty stagnant right now, so barring any medical breakthroughs that prevent or delay a lot of deaths from disease, they may not change all that much.

__________________"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?"-- Joe Dominguez (1938 - 1997)

It would sure help the discussion to link the actual bill and not just a media report.

Yes, it would. I searched for it, but couldn't find it on the government website. Probably because it was just filed a few days ago. The bill number is S 1431

The Senate bill delaying RMD age 72 to 2023 shuts me out of the benefit. Ironically, it also shuts out one of my US senators who was also born the same year. I contacted his office to voice my opinion.

I'm sure a lot of you recall that these bills are nothing new. They've been floating around both houses for several years. I believe that in late 2015 we had similar reports of unanimous passing of bills in bipartisan subcommittees that were going to eliminate the stretch IRAs. It didn't happen then and I'm really hoping it doesn't now. That said, it's likely only a matter of time so we might as well just get on with it. The House's ten year total cash out appears more reasonable to me than the Senate's five year/except $400K version, if for no other reason than the $400K would likely just get taken back the next go around.

Stating the obvious, this is within Congress's power. Morally/ethically (which has little relevance) they're taking away a carrot that was out there for decades. The reason for the original rules? "To encourage/increase savings." The reason for the new rules? "To encourage/increase savings." I guess savings is bad unless it helps the government out of a financial jam. How dare we try to give our children the basis of a good retirement when Washington needs the money to bail out somebody who never saved a dime.

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